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Two Frauds Combine Into One New Variety of Scam

Discussion in 'Forex Articles' started by Pharaoh, Feb 16, 2009.

  1. Pharaoh

    Pharaoh Colonel

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    Two Frauds Combine Into One New Variety of Scam
    by Pharaoh


    I think I've got a pretty good handle on the basics of HYIP-style Ponzi schemes that scam anywhere from a few dollars to someone's entire life savings. I understand the concept well enough that I published an article on Ponzi's and HYIPs just five days ago. Then I got a note from FPA Investigator Ken about something just a little bit different.

    It seems that an FPA member who had made the unfortunate mistake of getting involved with the BestFxWorld HYIP was suddenly being asked to pay for a “VIP Membership” that wasn't part of the rules when he joined the HYIP and also wasn't listed on the website when the demand for this additional money was made. They refused to take the money from the funds already in his HYIP account and demanded than additional payment be made.

    I had to ask Ken to recheck and confirm all the details very closely, since I knew what that kind of demand was and didn't think HYIPs did that sort of thing. He confirmed it all and then I knew my suspicions were true. The BestFxWorld HYIP was trying to commit its own version of advanced fee fraud in addition to the usual theft of account balances done by HYIPS that are getting ready to shut down.

    For those of you who don't know it by that name, advanced fee fraud is often called a Nigerian 419 scam (apologies to my fellow soldiers who are from that country, but General Abacha's “friends and family” sent enough faxes and emails to make that name common). The basic way it works is that for some reason, there is a sum of money that only you can help recover from a bank, security company, etc. The source of the money varies wildly. There are hundreds of different stories – money skimmed from petroleum contracts, money left by some person oppressed because of his beliefs, money left in a bank account by someone who died with no heirs, money confiscated from one of Saddam's palaces, etc. I've even seen one where there was supposed to be some huge forex profits sitting at an overseas brokerage that were somehow going to be transferred. The only thing they all have in common is that the money cannot be touched until you pay some fees. The trick is, you can pay and pay until you die of old age. You'll never see a penny. The oldest version of this scam date back many hundreds of years in Europe – a princess has been kidnapped and all you have to do is pay a modest ransom now and the king will give you a huge reward for resolving the issue so discretely.

    What all of these have in common is that you have to pay a fee in advance. The typical advanced fee fraud involves you trying to get money from an outside source. BestFxWorld has created a new version. BestFxWorld wants you to pay a fee up front to get your own money back.

    Just to add insult the fiscal injury already inflicted on Rockwarrior, during an online chat with BestFxWorld, they claimed that they could change the rules at any time and clients aren't allowed to complain. Under those circumstances, it would be foolish to send money, since that statement means they could demand more money at any time before paying one cent. Of course, that's how advanced fee fraud works. People who run advanced fee frauds operate on the idea that if you pay once, you'll probably pay again and again.

    Even worse, when Rockwarrior refused to give them more money, they also made the ludicrous threat that they would send the FBI to Portugal to arrest Rockwarrior for the crime of asking for money owed to him.

    Ken tried to reason with the BestFxWorld admin. He responded by proving his company was legitimate by saying that they were verified by ICANN. All that really means is that the company has a registered domain name. Anyone can have a domain name and ICANN doesn't check for criminal intentions.

    Next, BestFxWorld's admin threatened to complain to the FPA's registrar and hosting company and have the FPA shut down. I guess he didn't see the point that the FPA is also listed with ICANN and thus should be afforded instant invulnerability to all claims based solely on possessing a domain name – haha!


    So, what we have now is a HYIP reaching its terminal stage finding a way to merge the whole concept of advanced fee fraud in on top of the Ponzi-style thefts they are already committing. Overall, I find this to be a disturbing development.

    BestFxWorld is allegedly based in the USA. If they really are in the US, then the best thing for victims to do is to contact IC3.gov and provide as much information as possible. This is also a good idea for any US-based victims of HYIPS in other countries. If enough people provide good info to law enforcement, maybe a few dozen of these criminals getting to serve some hard time will slow this kind of scam down a little.


    Needless to say, those hard working people on the Scam Investigations Committee have declared BestFxWorld to be a scam and have officially blacklisted them. I'd like to thank Ken and the rest of the committee for letting me contribute to the cause by consulting in the case and writing this article.


    Official Scam Finding

    Rockwarrior's Original Complaint
     
  2. stefx

    stefx Recruit

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    Invaluable Service

    This is my first post on this awesome site.

    Forex introduced itself to me about 3 months ago with the advertisement of a robot. Initial research on this robot with a lot of good reviews and a bit of the negative ones led me to purchase. A long period of testing, adjusting and searching what else to adjust brought me to several sites including this one.

    This research gave me the clue of what all this robots can do. They all make more or less of small profits until sooner or later they will wipe out the account with the big hit if you don't "advise your expert". My personal "favorite" robot I saw in decompiled form with about 300 lines of code for 999$. If I am paid with 3$ per line I would probably not even think about trading.

    One important rule applies for every automated system in this world, as long as a system requires manual setup of parameters, the system is optimized for a specific range within it can operate. If the system inputs are leaving this range the results are unpredictable.

    At this point I knew that I rather prefer to learn and understand how to trade than to understand why and when to adjust what parameters of a system.

    So I made a plan for my approach to a successful trader. I started to apply the trading concepts from my first book, which is basically about upward or downward 1-2-3. Now that I completed my EA and set of indicators which are only used to handle my trailing stop depending on whether trading the trend or only the movement, my favorite trading style is the movement on M30 - H4, because once the position is opened the system can be left alone.

    Although I am not yet consistent enough, all test accounts from every brokerage I tried have profits, except the one I used to implement my EA.

    Doing this a while let me guess a lot what caused the strong a fast movements which are around there in the charts. This brought me to Sir Pipsalots economic calendar and trading signals. I will participate these signals a while find out if I would be able to learn how to filter the signals from the calendar like Sir Pipsalot does. Since Sir Pipsalot seems to be some kind of genius I might be pretty hard to work this out.

    After that I decide whether to go live with my system or with news trading or some combination of them.

    I hope the review moderation staff does not complain about this content placed in a review for scam, but all I want to say, that I makes no matter how much personal engagement you bring into your move to success until someone enlightens your path watching out the robbers and "gurus".

    This "someones" role is filled by the FPA in a perfect way, thanks to all, keep moving on ...
     
  3. omo9ja

    omo9ja Private, 1st Class

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    oh yeah! They wont stop being creative with new 419 ideas and they wont stop being caught as well. Why? Because everyone is creative in someway or the other only that great guys like you only channel your own creativity in the positive direction.
    Lt. ken, sarge and the whole scam investigation team, God bless you guys lavishly.
     
  4. Pharaoh

    Pharaoh Colonel

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    There's one thing about this that worries me - most of us know to avoid HYIPS, but what happens if other forex scams start using advanced fee fraud? Imaging a brokerage gone bad suddenly requiring you to send in an extra $100 before they agree to release a couple thousand back to you. Of course, once you send it, there will be more delays and fees.
     
  5. tingtong

    tingtong Private

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    It is already too bad if a broker goes bad to send fees anyway. Who would?
    If your account small, you write it down to loss probably on the experiences list, if you have bigger account, then better to choose a legit broker, not a small, noname kind. There is no 100% certainity anyway, remember some bank's defects...
    But hopefully brokers has a little more things to prove themself than a domain registered like this HYIP.
     
  6. PistolDave

    PistolDave Corporal

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    Scams like this one will surely become more prevalent with the increase in the popularity of retail forex trading.

    There is one fundamental that keeps these scams going on and on... and that is the human nature flaw called greed. There will always be a steady supply of new and foolish "investors" who are looking for something for nothing. This is the food that scammers feast upon.

    The moral of the story is: Don't be a loser -- if it seems to good to be true, IT IS!

    Thanks again for your good work, FPA. We need ya.:D

    PistolDave
     
  7. amirulamar

    amirulamar Recruit

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    BestFxWorld SCAM

    Damn BestFxWorld SCAM, they steal my money and not answer my mail...:mad:
     
  8. cowmadagan

    cowmadagan Sergeant

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    One other thing I should caution against is the attitude that the more experienced among us are just jaded or ill informed. The reason why we know what interest rates are reasonable is that we know what percents you can get with what level of risk.
    Before I got into trading I thought that the interest rates they offer at banks were rock bottom. Many professional analysts target 20% per year if they're trading full time. 80-90% of new traders lose all of their money though. Honestly, banks give low guaranteed deposit and interest because things can go horribly wrong.
    We're not jaded, and we're not egoically compensating by saying "I can't do it, so no one can."
     
  9. Pharaoh

    Pharaoh Colonel

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    There are some very successful traders out there in various markets who can pull down 10%+ per year and have some consistency. These people are rare and generally don't set up their services on a quick and dirty website that was recently thrown together. These people are willing to show live trading records to potential investors who have enough money. These people also will never guarantee profits or demand an additional payment to refund client money.

    The one thing I am VERY sure of is that there's no system or trader out there that can offer guaranteed profits of several % per day each and every day that the market it open. Just run the numbers for compounding and you'll see that in a few years anyone who invests a dollar into such a thing would be able to hire Bill Gates as a household servant.

    For anyone who really wants to know how to get "Free Money", send me $100 and I'll send you $50 - for free!
    :p
     
  10. CharlieB

    CharlieB Recruit

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    BestFxWorld--Not Good

    I was trying to get my LR transferd--They told me the VIP fee was $39.99--I figured that was not too bad if I could recover anything--I was still spending and increasing my balance, but then the VIP conversation started=====they emailed me and they wanted my LR info--they said they needed to check it for security!!!I told them they do not need that info to install funds into an account at Liberty Reserve (LR)....Also a batch number had better be there--then they disappeared...have not heard from them..maybe won't??
     

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